With arguments from the Crown and defence now completed and the court adjourned until October in the Meng Wanzhou case, the positions of both sides in perhaps the highest-profile extradition case in Canadian history have crystallized.
BC Supreme Court Associate Chief Justice Heather Holmes is expected to announce her final decision October 21 on whether the Huawei Technologies CFO will be extradited to the United States – almost three years after Meng’s arrest at YVR on December 1, 2020.
The case has tremendous geopolitical ramifications. Meng’s arrest marks the lowest point in Canada-China relations in recent memory and comes at a time of growing tension between Washington and Beijing.
But the Meng case, as it stands, has largely blocked out the geopolitical machinations outside of the courtroom – with the exception of when statements by former U.S. President Donald Trump were cited by the defence as potential evidence of political interference in legal matters.
What happened
While the Crown and Meng’s team of lawyers have fought tooth-and-nail over the U.S.A.’s record of the case (ROC: the official account of what happened in the Meng case leading up to U.S. charges against her), there are a few points that both sides agree upon:
1) Meng’s trouble arguably started in 2012 and 2013, when a pair of Reuters articles outlined accusations that Skycom – which the report described as a subsidiary owned by Huawei – was selling embargoed U.S. telecom equipment in Iran. That would have violated U.S. sanctions against Iran at the time, although neither Huawei nor Skycom are U.S. entities and therefore not subject to U.S. law.
2) In 2013, after the second Reuters article, HSBC (LON:HSBA) officials met Meng and Huawei representatives in Hong Kong, where Meng made a PowerPoint presentation to discuss Huawei’s relationship to Skycom, its business operations in Iran and sanction risk to HSBC – which processes transactions through the U.S. financial system.
3) After that meeting, an HSBC risk assessment committee met at least twice – once in London and once in New York – to determine whether to continue providing banking services to Huawei. The final decision was to continue doing business with Huawei, and transactions – including those in Iran – continued to be cleared through the U.S. financial system.
4) Meng was arrested in December 2018 in Vancouver while connecting from Hong Kong to Mexico City. Charges against her were formally announced a few months later by the U.S. Department of Justice. They included counts of fraud, money laundering and the theft of trade secrets from U.S. companies like T-Mobile USA (Nasdaq:TMUS).
What’s being contended?
The United States accuses Meng of misleading HSBC during that 2013 meeting about Huawei’s relationship with Skycom. Crown prosecutors contend that Skycom, despite being sold by Huawei in 2007 to Canicula, a third-party holding company, remains under Huawei control because Canicula was also owned by Huawei employees. The allegation is that Meng lied to HSBC, telling the bank that Skycom is a third-party partner not linked to Huawei, prompting HSBC to continue banking relations with the Chinese tech giant and incurring the risk of penalties when it violated U.S. sanctions by clearing Iranian transactions through the U.S. financial system.
The defence’s arguments are more complex. Lawyers describe it as a “tree” of abuse of the extradition process to achieve Washington’s geopolitical goals. Meng’s lawyers outlined several branches of that “tree.”
Defence contentions include:
•Political interference from the White House stemming from Trump’s comments after Meng’s arrest that he might intervene in the case if it meant advantages in trade talks with China;
•Alleged RCMP and Canada Border Services Agency (CBSA) collusion during Meng’s arrest to illegally secure evidence in a criminal case against her. The Huawei executive alleged that the CBSA seized her electronic devices and passwords without arresting her and reading her charter rights, then passed on both the devices and the pass codes to the RCMP – after she was formally arrested;
•Inaccuracies and intentional misrepresentations in the ROC and supplemental versions of the ROC provided by the United States, which allegedly embellished facts to “trick” Canadian officials into approving a provisional arrest request against Meng.
Although the arguments late last year centred on the second branch – including testimony from CBSA officials that appeared to indicate they were told by superiors not to take notes in Meng’s arrest to avoid creating evidence that might be used in court, and the refusal of one key RCMP officer to testify – the most recent arguments have centred around the third branch and whether or not Meng committed fraud.
On that point, the Crown contends that Meng misled HSBC and deprived it of information it needed to make an informed decision on Huawei and potential violation of U.S. sanctions. Meng’s side argues that Skycom is a separate legal entity from Huawei, that HSBC senior officials already knew about the truth of the Huawei/Skycom situation – deciding to clear transactions through the United States anyway – and that nothing in Meng’s 2013 presentation to HSBC directly caused the bank to lose money or hurt its reputation.
The final decision
If a stay of extradition is announced, Meng is free and presumably will be on her way back to China as soon as the announcement is made.
If Meng is committed to extradition, however, it opens up a number of possible options for the Huawei executive. Officially, the extradition would enter its third and final phase, in which the federal justice minister would have to decide whether to surrender Meng to the United States.
However, any extradition subject can appeal the decision and apply for a judicial review. If the person sought in extradition is well-resourced, he or she can do both – and, if neither avenues were successful, the accused can appeal to the Supreme Court of Canada.
There’s no guarantee that the Supreme Court would hear the appeals, but it will hear cases that “raise issues of public importance,” which may be the case with the Meng matter.
